Courtesy of Benzinga.
Let’s face it, I was not the biggest fan of Steve Jobs. He knew how to run a company, but he just seemed to be extremely stingy. Not only did he not donate any of his money to charity, but Apple (NASDAQ: AAPL) was run stingily as well.
For example, the exclusivity revolving around the iPhone and MacOS software is nauseating, to me at least. In fact, Apple may have been able to make more money by licensing the operating system to certain computer manufacturers, including Dell (NASDAQ: DELL) and HP (NYSE: HPQ). The iPhone could have also garnered much more revenues by being on multiple carriers. While the iPhone has been expanding its reach, it could have been done earlier, especially considering that many Americans prefer Verizon (NYSE: VZ) over AT&T (NYSE: T). Regardless of his tactics, Jobs maneuvered his company to greatness, in the eyes of Wall Street and the greater public.
Steve Jobs has since passed, and Tim Cook has taken the reigns of the company. Apple’s share price is continuously appreciating, and there may be various ways for the company to further increase its value. Recently, rumors started circulating that Apple may be issuing a dividend. Under the Jobs administration, this move was unfathomed. Despite having a gargantuan cash pile, Jobs refused provide his shareholders with cash dividends. If Cook instates quarterly dividends, I for one think that he is doing the company and its shareholders justice.
While many shareholders built their investments when Apple was worth $100 and even $200 per share, many more took the risk at $300 and $350. These late shareholders are true believers. When the company reached the $300 level, many traders were in disbelief and believed that the company’s stock would never stay that high. For the risks that some investors made, a dividend would be greatly appreciated.
Issuing a dividend could also help Apple in the long-term. Many investors have been apprehensive in taking larger positions in the company. However, with an attractive dividend, Apple may look a lot more attractive to the uncertain investors. This could result in a large influx of long-term investors looking to use Apple stock as an income-generating vehicle.
Tim Cook has yet to prove himself in a monumental way. Whether it’s producing the next iPhone or iPad upgrade, or the next “iDevice,” Tim Cook has to prove to investors that he will be able to steer the company in a positive direction like his predecessor. I personally think a quarterly cash dividend could do just that. Only time will tell, but rewarding his investors may be one of Tim Cook’s best ideas.
